Retailing: Big sales from bargain hunters

The retail chain 99p Stores has had a successful run because so many shoppers are pinching pence while the economy remains stalled. In fact, the decade-old chain's profits are three times higher than its profits of just one year ago. The one-price strategy has clearly been very effective in attracting buyers and retaining shopper loyalty.

Now 99p Stores is expanding into more UK storefronts left empty by failing retailers, aiming for more than 170 branches by the end of 2011 and up to 600 branches by the end of this decade. The chain is looking at European continent expansion, as well.

Given the chain's high-tech distribution system, it can reportedly wring a 20% profit margin from nearly every range it sells. Low prices on everyday merchandise bring shoppers back again and again for household purchases (and maybe an impulse buy or two along the way). According to the Independent, the top sellers at 99p Stores are mouthwash, pain reliever, snacks, soft drinks, teabags, toilet paper and tissues.

Will shoppers change their habits when the economy improves?